Business

European shares fall as Macron’s snap election sends French stocks lower

Banks among the sectors under pressure in Europe, while Wall Street stocks advance

On Wall Street, the S&P 500 and the Nasdaq turned higher in the first hours of trading. Photograph: Angela Weiss/AFP via Getty Images

Laura Slattery
Mon Jun 10 2024 - 18:16

European shares fell on Monday, with French stocks hit after president Emmanuel Macron called a snap election following a heavy trouncing of his allies in European Union parliamentary elections.

France’s blue-chip CAC 40 index fell 1.4 per cent to touch a more than three-month low, with lenders, including BNP Paribas, Societe Generale and Credit Agricole, falling by between 3.6 per cent and 7.5 per cent.

Dublin

The Iseq picked up where it left off at the end of last week, with pressure on stocks sending the index down 1.2 per cent. Ryanair fell 2.2 per cent to €17.20, while packaging group Smurfit Kappa was down 1.7 per cent at €42.88 by the close and insulation-maker Kingspan declined 1.5 per cent to €85.50.

The weaker sentiment also affected Kerry, with the food group slipping almost 0.5 per cent to €76.95, while two sessions on from the European Central Bank’s interest rate cut, Bank of Ireland slid 1.1 per cent to €10.10 and AIB finished 0.5 per cent lower at €5.10 at the end of a day with few climbers of any note.

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London

Britain’s blue-chip FTSE 100 closed down 0.2 per cent, while the mid-cap FTSE 250 fell 0.5 per cent for a second straight session of losses.

Most UK sectors ended lower, with beverages stocks among the worst hit, declining 2.1 per cent, although energy stocks gained 1.2 per cent as oil prices rose by $1 per barrel.

Among individual stocks, ME Group International fell 4.9 per cent after the instant-service equipment group said its full-year profitability was in line with expectations.

Insurer and asset manager M&G bucked the downtrend, rising 2.4 per cent and topping the FTSE 100 after analysts at JP Morgan upgraded its rating to “overweight” from “neutral”.

UK insurer Aviva slipped 1.7 per cent after JPMorgan downgraded the stock to “neutral” from “overweight”.

Europe

The pan-European Stoxx 600 index fell 0.3 per cent, with other regional markets, including Germany’s Dax and Spain’s Ibex down 0.3-0.4 per cent each.

Shares in French motorway operators Eiffage and Vinci fell by more than 5 per cent while airports group Aeroports de Paris and energy firm Engie shed 4.1 per cent and 3.2 per cent respectively.

Most sectors traded lower, with euro zone banks the worst hit with a 1.6 per cent drop, while oil and gas was an outlier gaining 0.9 per cent tracking higher crude oil prices.

French bond prices also fell, pushing yields on the 10-year note to their highest level in more than six months after Eurosceptic nationalists made gains in European Parliament elections on Sunday.

US

On Wall Street, the S&P 500 and the Nasdaq turned higher in the first hours of trading, while the Dow was flat as investors remained wary ahead of a key inflation reading as well as a Federal Reserve meeting this week, which could provide clues on the central bank’s policy-easing path.

The S&P 500 pared early declines, while gains in companies including Microsoft, Amazon and Broadcom helped the Nasdaq trade slightly higher.

Chipmaker Nvidia rose 1.1 per cent in choppy trading after a 10-for-one stock split that went into effect after markets closed on Friday, giving rise to chatter about the chances of its inclusion in the blue-chip Dow.

Apple slipped 0.8 per cent ahead of the iPhone maker’s annual developer conference for updates on how it is integrating artificial intelligence into its offerings.

Southwest Airlines jumped 8.6 per cent after activist investor Elliott Investment Management disclosed it has built up a $1.9 billion position in the company.

Meanwhile, video game retailer GameStop reversed early gains to slump 12.7 per cent after losing nearly 40 per cent on Friday. – Additional reporting: Reuters

Laura Slattery

Laura Slattery

Laura Slattery is an Irish Times journalist writing about media, advertising and other business topics

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